Monthly Archives: July 2016

Jul 28

Sweet Spots – How to Decide The Price Level of Your Fashion Line and Succeed

By Maria Pesin | Business , Fashion , Vibe Consulting

How to decide the price level of your fashion line?  This is a major question to answer when you first start your fashion line.  It is the second one after who is your customer.  My new clients find this very hard to answer.  Many times they can find the answer by shopping the stores and looking at the lines they feel are their competition.  However there are times when the answer eludes them. They see that their line can go into several different places.  So what are the different levels?  The following is a guide that can help.

  • Popular – a low price that people are willing to pay.
  • Moderate – a product that is neither very cheap nor very expensive compared to other products of the same type.  It is a level up from popular.
  • Better – this is the next level up from moderate.  It consists of better quality product, but is not as high as luxury.
  • Bridge – this department was developed to “bridge” the gap between better and designer.
  • Designer – top of the line, luxury products.

Within these areas different stores further define things.  Contemporary and young designer are ways for retailers to segregate departments so that there is more clarity for their customers.

When deciding what is best for your brand you will need to define the demographics and psychographics of your customer.  Knowing their income and how they spend their money can give you great insight to what department would better serve them.

Then when you have decided, the lines prices must reflect a value proposition relative to where the competition is positioned. The reasoning is that the overall competitions prices establishes the price points that a customer will see and compare your product to.  If you are higher than your competition there must be a real justification for it.

Sometimes you might want to offer really cheap prices but do not have the level of production that will get you the best prices from factories.  In those cases it might be best to make the product superior to what it hangs with and that will allow for the extra cost.  When you aren’t pricing apples to apples then your customer will forgive the extra expense.

 

Jul 19

5 Ways To Use PR To Build Your Fashion Brand

By Maria Pesin | Business , Fashion

These days it is all about branding.  Branding, according to Entrepreneur Magazine, is a marketing strategy that involves creating a differentiated name and image — often using a logo and/or tag line — in order to establish a presence in the consumer’s mind and attract and keep customers.  Customers want to by from brands they know and like.  Stores want to buy brands to entice consumers to their places.  It is definitely the age of branding. A strong Public Relations (PR) campaign be an effective way to build awareness of your brand.   The following are 5 ways to use PR to build your fashion brand:

  1.  Reach out to influencers –  Bloggers, Tweeters, Celebrities, Brand Amabassadors, anyone who has a strong list of followers can get your message out.  Malcolm Gladwell, Author of The Tipping Point: theorizes that there are ‘mavens’ out there that are the first ones to grab onto new trends. These influencers are few and powerful and these are the one out of ten folks who tell the other nine where to shop, what to buy, and more.
  2. Create story lines you can pitch – Journalists are looking for things to write about.  However a press release that sound like a sales pitch will not get you press.  You need to have a story that will appeal to their readers.  Not just a one page that promotes your company and tells them how great you are.  For example:  write about what problem your product solves.
  3. Have an event – It doesn’t have to be expensive.  You can do an event at a store you do business with.  You could have informal modeling of your new collection with refreshments and invite local press and potential customers.
  4. Use content marketing – Write blogs with pictures about subjects you think your customer would be interested in.  For example if you are an ath-leisure brand you can write a post about yoga poses with models wearing your product.
  5. Use photographs with everything – This is a visual business.  Great photography will get people interested.  Use it on all your social media.

To create a brand people have to know about you.  PR is an important component to your whole marketing campaign.  Do it right and you can create a loyal  audience.

 

Jul 13

The Fashion Industry Is Not For The Faint Hearted

By Maria Pesin | Vibe Consulting

The fashion industry is not for the faint hearted.  Let’s face it.  It is a tough business.  Stores are having a hard time being profitable.  Collections are struggling to do business.  The industry finds itself competing with other industries for consumer dollars.  Before people bought mostly clothing with their discretionary income.  Now they are buying cell phones, computers, flat screen TV’s, renovating houses, and hiring personal trainers.  There is a lot of competition for the same dollars.

That doesn’t mean that their aren’t companies out there doing incredible businesses.  Brands like Free People,  Steve Madden, and Zara are on their game and their results show.  However,  the industry is challenging so it is important to run your “A-game” if you are going and stay consistent.

I spoke with two young entrepreneurs this week who both told me the same thing.  They hit obstacles in their businesses and lost motivation.  They found themselves slacking off and were no longer doing the things they knew they needed to do to drive the business forward.  The important fact they forgot is how you deal with obstacles is what defines you and your business.  Every business hits obstacles. And every business owner gets discouraged.   That is a fact of life.

“Obstacles don’t have to stop you. If you run into a wall, don’t turn around and give up. Figure out how to climb it, go through it, or work around it.” –  Michael Jordan

When I started my consulting business I was very committed to its success.  I had no plan “B” if it didn’t work out.  I only had plan “A”.  Which was to keep working on my business till it became a success.  Like all businesses I hit snags. It is how I handled them that made my business flourish.

“Things never happen on accident. They happen because you have a vision, you have a commitment, you have a dream.” –  Oscar de la Renta

How are you going to approach your business?  Are you in it for the long haul?  If so, pick yourself up and dust yourself off after any stumbling block and keep on keeping on.

 

 

Jul 11

How much is too much? How to Establish Your Retail Pricing.

By Maria Pesin | Fashion , Sales

 

Establishing your retail pricing effectively is a key part of the retail success of you collection.  So how do you decide what the suggested retails (MSRP – Manufacturers Suggested Retail Price) for your fashion line should be?  This is a question that comes up a lot with my clients.  The answer is not a hard and fast rule.

There are two ways to figure this out. You can multiply your wholesale cost by 2.2 to 2.6. Let’s say you have a t-shirt that your are wholesaling for $10 and you decide to use 2.4 as the markup.  $10 X 2.4 = $24.   Or you can have a percentage calculation also know as an IMU (Initial mark up).   An example would be a dress that wholesales at $75.  that you elect to add a mark up of 60%.  The calculation would be $75 divided by .40 = $187.50.  Here you take the cost complement of 60% which is 40% and divide by the wholesale to come up with the MSRP.

Now that is how you do it, the next question is what should your retail business model be?  Whether you multiply by a fraction number or divide by a percentage the most important things are to look at:

  1. Is there enough margin in there for stores you sell to make money?
  2. Is your pricing competitive?

These days you need to work at more than a double of the wholesale in order for retailers to have a cushion to off set margin erosion.  Margin erosion occurs when a store has to put left-over inventory on sale.  So making sure you have enough margin in there will help make your product more profitable for the stores.  Yet, you must make sure you are  not overpricing your product otherwise it will not sell as well.

Pricing your line is a delicate balance between the two.  Make sure you do your homework and know what comparable product is sold for.  This will help you when pricing your collection.